Biden's pick for OMB downplays concerns about inflationary pressures

FILE PHOTO: Neera Tanden, director of the Office and Management and Budget (OMB) nominee for U.S. President Joe Biden, removes her mask during a Senate Homeland Security and Governmental Affairs Committee confirmation hearing in Washington, D.C., U.S., February 9, 2021. Ting Shen/Pool via REUTERS

WASHINGTON (Reuters) – The U.S. government must keep a close eye on inflationary pressures, but the Federal Reserve has tools to deal with inflation and interest rates, Neera Tanden, President Joe Biden’s nominee as budget director, said on Tuesday.

Asked about concerns that Biden’s $1.9 trillion relief plan would cause overheating in the U.S. economy, Tanden said it was vital now to provide aid to Americans suffering as a result of the COVID-19 pandemic and avoid long-term economic scarring.

“We have to be concerned about inflationary pressures, but the real challenge … right now is that we can face a potential of significant scarring in this economy… and it it vital that we act,” she told a confirmation hearing before the Senate Homeland Security and Governmental Affairs Committee.

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